Nextenergy Solar Share Discussion Threads

[ammons] 23/8/2022 09:41

No fears about the "no windfall taxes" Tories imposing windfall taxes on all the energy producing companies?

[hiddendepths] 23/8/2022 09:40

tuftymatt - if you click on a poster's name you can see their posts on all stocks.

I found this looking at CC2014's record. Hope he doesn't mind me posting it here.

"I've recently sold my FSFL and NESF bought in Feb and some other renewables and switched some into AEET."

FWIW I bought a few AEET recently too.

[hiddendepths] 23/8/2022 09:30

CC2014 - good points!

I would suggest that the gearing is a good thing in the current environment. I was more doubtful when times were more normal so have only a modest holding. When I said the debt was fixed, I didn't mean that the interest rate was fixed, just that the debt itself is a fixed sum being eroded rapidly in real terms by high inflation.

I agree about the discount rate - this company is far from alone in being unwilling to change that assumption. I think they should - there's a sort of collective blindness about this, a disbelief that inflation is really here and it's likely to take quite a while to get under control.

[tuftymatt] 23/8/2022 09:06

Thanks and what did you go into CC2014?
I am happy with the double digit return here in the past 4 weeks but value the points you have raised.

[cc2014] 23/8/2022 08:41

Here are the arguments for what's holding this back. Note I'm no longer a holder, having sold out a few weeks ago as I needed the cash for something with a better return.

1. The gearing is too large and the fund manager shows no regard for reducing this. Whilst some of the debt is fixed, some of it isn't
2. Those convertable pref shares look cheap on the headline interest rate but long term I suspect are going to be highly dilutive
3. The discount rate in the DCF calcuation is beginning to look questionable. NESF are taking the benefit from high prices and inflation and improved future cashflows but not the disbenefit of the discount rate (arguing asset prices remain high I think)
4. Solar power seems to be being cannabalised far more than wind. It seems to be the wind and hydro assets which run at the highest premium

[hiddendepths] 23/8/2022 07:54

Gearing is good at times like this. Debt is fixed and all the increase in asset value is attributable to shareholders. Should justify a hefty premium as there's no sign of a slowdown in asset value growth imo. A positive gearing effect!

[marktime1231] 22/8/2022 12:23

Awesome NAV progress ahead of expectations but the response +2.5p only takes the share price back to par. BSIF also a good report and response on an otherwise bleak day. What is holding this back from progressing to a decent premium, the yield is strong and well covered by income, and NAV will continue to advance with inflation etc.

Heavy gearing?

[woodhawk] 22/8/2022 10:14

Truss also talking about extending windfall tax too. She is an absolute disaster waiting to happen - the last thing this country needs after the appalling and useless Bozo the Clown. Unfortunately Bozo cleared out all the non-Brexiteer Tories (i.e. the relatively sensible ones), which explains the pathetic calibre of the brain-dead lunatics that remain.

[sam 4224] 22/8/2022 10:12

Very pleased with this share but read in the results today that 50 percent of its revenue come from govt subsidies. If a new govt cuts green support, to what extent are we possibly exposed ? Grateful for thoughts .

[tuftymatt] 22/8/2022 07:22

Fantastic 😀👍🏻

[masurenguy] 22/8/2022 07:10

NAV up 7.2% to 121.7%. Dividend up 5.0%.

[spoole5] 22/8/2022 07:04

Great update!

[tuftymatt] 18/8/2022 20:02

Yeah really good. I think the little dip allowed a few to buy in ready for the next leg up.

[badtime] 18/8/2022 18:28

Good exdiv day

[marktime1231] 12/8/2022 15:34

Um er must have mucked up my calculation sorry and thanks.

[scrwal] 12/8/2022 13:00

mark
How do you arrive at £5M - isn't it shares issued x price so 269,657 x 113.5p = £303,364 ?

[marktime1231] 12/8/2022 11:12

Answering my own question.

The scrip has been available for a couple of years I think, not getting much attention as the take up is low. Around 270,000 scrip shares issued last quarter, whearas if everyone was doing it the quarterly scrip issue would have been around 9 million.

So the immediate effect is a trivial dilution of the total 590 million shares in issue. The cash saving is [edit - see scrwal calculation]

[marktime1231] 11/8/2022 11:22

Only just spotted that NESF offers a scrip alternative to a cash dividend. I wonder what the take up of that is, and what the net effect is on the company and shareholders.

[edward3] 11/8/2022 07:46

Great stuff 6.3% dividend yield

[tuftymatt] 11/8/2022 07:44

Very nice indeed.

Divi growth and share price growth = happy days.

[masurenguy] 11/8/2022 07:18

Dividend increased by 5%.

Interim Dividend Declaration

NextEnergy Solar Fund, is pleased to announce an interim dividend of 1.88p per Share for the quarter ended 30 June 2022. The interim dividend of 1.88p will be paid on 30 September 2022 to shareholders on the register as at the close of business on 19 August 2022. The ex-dividend date is 18 August 2022.

[gbcol] 09/8/2022 16:07

Except there is a £200m difference between the automatic entry level to FTSE250 (currently circa £734m) and the automatic exit level (currently circa £530m), so if you can get in you would need to fall more than 27% to fall back out (assuming other companies stay around similar levels). On top of that, any fund raising would make the position even more secure.

Getting into FTSE250 isn’t necessarily the be all and end all anyway but it would probably help with the wider range of funds that could invest in it.

[a0002577] 09/8/2022 15:50

Hi GBCol, trouble is when a share move into the FT-250 without a big buffer, it will likely drop out again whne uts share price drops a small amount. This exacerbates the share price fall. Remember that every share price goes on an annual random walkabout.

Every year Since launch NESF share price has wandered up and down by 10 - 15%.

Yr MIN MAX
2014 101.00 106.25
2015 97.75 109.25
2016 92.25 109.75
2017 105.25 116.00
2018 107.50 115.00
2019 112.00 125.00
2020 87.60 126.50
2021 96.50 107.40
2022 99.60 119.00

[gbcol] 09/8/2022 14:57

A share price of around 125p would currently get NESF into FTSE250. Currently MCap is circa £700m based on 119p share price A share price of 125p would increase that to £736m which is the value around entry level.

Of course a fund raise, should they manage to get to a NAV premium and be able to do one, would make entry even more likely.

Holding funds like these sure sweetens the pill of the rising domestic bills and no sign of the current trend changing anytime soon. Great for funds like NESF, bad news for households.

[a0002577] 09/8/2022 14:35

Hmmm... Not sure that a share price rise is necessarily a good thing especially if you want to buy more. As to NAV - it is a fickle thing and its calculation is as much art as science and certainly totally dependent on some human assumptions.

A premium to NAV is probably a good thing as it make it possible to raise more money and possibly increase market cap sufficiently to get NESF into the FT-250.

What really matters is cash flow in and dividend cover - will it be enough to sustain the dividend? And that looks pretty much assured.

Having said that the share price is certainly moving up in line with it peers (FSFL, BSIF) and will in due course give me a chance to sell to wait a bit and buy back at a lower price. A strategy I have used with all the Green Infrastructure funds from time to time.

My Guess is that the share price will sleep walk up to about 128-130 and from then on swing between 110 t0 130. Trouble is timing the swings.

I ;ike this company and look forward to its further development.